Global venture capital (VC) investment rose from $112 billion in Q2’25 to $120 billion in Q3’25 – marking the fourth consecutive quarter of robust investment, according to the latest edition of Venture Pulse from KPMG Private Enterprise, a quarterly report tracking investment trends globally across major regions around the world.
The Americas led with $85.1 billion, while Asia saw muted investment at $16.8 billion. AI continued to dominate VC activity, with significant funding rounds for AI model development and applications. The US accounted for most of the VC investment in the Americas, while Europe saw solid growth. Global exit value climbed to $149.9 billion, the highest since Q4'21, driven by renewed IPO activity. Looking ahead to Q4'25, global VC investment is expected to remain stable, with AI continuing to dominate. Robotics and defensetech will also continue to be focus areas.
The last time the global VC market saw $100 billion+ in investment for four quarters in a row was between Q4’21 and Q3’22. While overall deal volume eased slightly—reflecting a typical seasonal slowdown across the Americas and Europe—the broader market trajectory remained positive. Investor sentiment strengthened steadily throughout the quarter, buoyed by renewed optimism around liquidity pathways and a gradual reopening of exit markets in the Americas and Asia.
During Q3’25, the focus of VC investors globally concentrated on large deals—with 10 megadeals valued at $1 billion or more. Eight of these deals occurred in the US, led by raises by Anthropic AI’s of $13billion and xAI’s $10 billion.
AI continued to dominate VC investment activity in other regions as well in Q3’25. In Europe, France-based Mistral raised $1.5 billion and UK-based Nscale raised $1.5 billion. In Asia, Australia-based Firmus raised A$330 million ($220 million), while China-based MiniMaxAI raised $300 million and South Korea-based Rebellions raised $244 million. In addition to startups engaged in foundational AI model development, venture capital investors worldwide demonstrated increasing interest in AI-powered applications and sector-specific innovations. Beyond AI, defense technology and space technology garnered significant attention during the quarter, largely due to persistent geopolitical tensions. Health technology, quantum computing, and alternative energy also maintained strong investor interest throughout Q3’25.
Regionally, the Americas led global VC investment, attracting $85.1 billion across 3,474 deals in Q3’25—more than 70% of the total funding seen globally during the quarter. Within the Americas, the United States accounted for $80.9 billion across 3,175 deals. Europe attracted the second-largest share of VC funding during the quarter—$17.4 billion across 1,625 deals—overtaking Asia, where VC investment remained somewhat sluggish at $16.8 billion across 2,310 deals.
“AI is obviously the biggest ticket right now for VC investors globally. If startups aren’t embracing AI in some way, shape, or form, it’s very difficult for them to attract attention,” said Conor Moore, Global Head, KPMG Private Enterprise, KPMG International. “Many of the industries where we’re seeing strong investment are being driven in part by AI-driven solutions—like defencetech and healthtech—or by their importance to the AI ecosystem—like energy and datacentres.”
Pangratios Vanezis, Board Member and Head of Enterprise & Startups, KPMG in Cyprus, commented: “The Q3 findings confirm the resilience of the VC market: US$120.7 billion in investments and US$149.9 billion in exit value, with AI remaining the primary growth driver. Despite the positive exit trends, fundraising continues to lag (US$80.7 billion year-to-date), requiring disciplined capital planning. For Cypriot companies, investing in technology (AI, robotics, defencetech, healthtech) and preparing strategically for capital markets or strategic investors is critical. KPMG in Cyprus supports founders and investors with targeted strategy and access to international markets”.
Q3’25 — Key highlights
- Global VC investment increased from $112.4B billion across 8,860 deals in Q2’25 to $120.7 billion across 7,579 deals in Q3’25.
- VC investment in the Americas rose from $80.4 billion in Q2’25 to $85.1 billion in Q3’25, driven primarily by the United States—where investment increased from $77.1 billion to $80.9 billion over the same period. Europe also saw a solid uptick in VC investment from $15.2 billion to $17.4 billion, while VC investment in Asia rose slightly from $15.6 billion to $16.8 billion yet remained near historic lows.
- Corporate VC participating investment increased from $56.1 billion in Q2’25 to $58.6 billion in Q3’25. The United States accounted for a large share of this total ($37.7 billion), marking its fourth consecutive strong quarter of CVC associated investment. Europe reached a five-quarter high of $9.5 billion in CVC participating investment during Q3’25, while Asia continued to see muted CVC related investment at $9.1 billion.
- Software remained the leading sector for VC investment, attracting $176.1 billion as of the end of Q3’25—driven primarily by strong activity in the United States. Investment in the software space has already flown by 2024’s total of $147.2 billion, although it is not likely to surpass 2021’s record $256.6 billion.
- Global exit value climbed from $119.2 billion in Q2’25to $149.9 billion in Q3’25—the highest level seen since Q4’21. At a regional level, U.S. exits rose from $71.0 billion to $74.5 billion quarter-over-quarter, while Asia saw a sharp increase from $28.7 billion to $38.0 billion. Europe also recorded significant growth, with exit value rising from $17.3 billion to $27.8 billion between Q2’25 and Q3’25.
- Global VC fundraising remained exceptionally weak, totaling just $80.7 billion at the end of Q3’25—putting it on pace to fall below 2024’s eight-year low of $196.1 billion.
AI continues to power the VC market globally
VC investors continued to double down on AI in Q3’25, with companies developing AI models and platforms attracting many of the largest funding rounds of the quarter. In addition to the blockbuster $1 billion+ raises by Anthropic, xAI, and Mistral, US–based Reflection AI also secured $1 billion, underscoring the sustained investor appetite for transformative AI technologies. The surge in AI investment extended well beyond the U.S. and Europe. In Canada, Cohere raised $600 million, while in China, MiniMax AI closed a $300 million round. Beyond these headline transactions, AI-focused startups across regions continued to attract significant VC funding rounds, reflecting the growing breadth and attractiveness of AI-focused solutions.
Global exit activity reaches 15-quarter high as IPO market reopens
Global exit value surged to $149.93 billion in Q3’25, marking a 15-quarter high; the strong exit value was driven in part by renewed IPO activity in the US and continued M&A activity globally. Exit value was up across the Americas, Europe, and Asia in Q3’25; in the Americas, exit value rose from $72.8 billion to $83.9 billion, while in Europe it rose from $17.3 billion to $27.8 billion. Asia also saw exit value rise from $28.7 billion to $38 billion, supported by IPO activity in both Hong Kong and India.
One of the most encouraging developments of Q3’25 was the revival of IPO markets—particularly in the US—which provided long-awaited exit opportunities after years of subdued activity. The number of successful listings not only validated valuations in select high-growth sectors but also reinforced investor confidence that the exit window for VC-backed companies is reopening. For VC investors, the combination of sustained capital deployment and healthier exit conditions suggests a more constructive and balanced venture capital environment heading into 2026.
VC investment in Americas dominated by US-based AI ecosystem investments
VC investment in the Americas rose from $80.4 billion to $85.1 billion, despite deal volume falling from 3,938 to 3,474—a low not seen since Q2’20. The US accounted for $80.9 billion in VC investment during Q3’25, while Canada attracted $2.7 billion and Brazil attracted a 12-quarter high of $1.1 billion.
Outside of Latin America—where fintech attracted the bulk of interest from VC investors—AI ecosystem players dominated VC investment in the Americas. Four US-based startups raised $1 billion+ funding rounds (Anthropic—$13 billion, xAI—$10 billion, Reflection AI—$1 billion, Databricks—$1 billion), while Canada also saw large deals, led by a $600 million raise by Cohere.
VC investment in Europe solid, led by two $1 billion+ deals
VC investment in Europe rose from $15.2 billion in Q2’25 to $17.4 billion in Q3’25, though overall deal volume remained soft—falling from 2,085 to a ten-year low of 1,625 quarter-over-quarter. The AI sector was incredibly hot in Europe this quarter, led by a $1.5 billion raise by France-based Mistral and a $1.5 billion raise by UK-based Nscale. Fintech also attracted robust investment in Q3’25, with raises by UK-based Rapyd Financial Network ($500 million) and PS Miner ($350 million). Quantum computing also attracted growing interest, evidenced by Finland-based IQM’s $320 million raise.
At a jurisdictional level, the UK attracted the largest share of VC funding in the region ($6.2 billion), followed by France ($2.7 billion), the Nordics region ($1.8 billion), and Germany ($1.3 billion).
Asia continues to see very soft VC investment and deals activity
VC investment in Asia rose slightly from $15.6 billion across 2,632 deals in Q2’25 to $16.8 billion across 2,310 deals in Q3’25. Despite the uptick, both VC investment and deal volume remained very low compared to historical trends, driven primarily by ongoing geopolitical and trade tensions. Despite the continued softness of its VC market, China attracted the largest share of VC investment in Q3’25 ($8.4 billion)—driven by a $462 million raise by automotive company FAW Bestune, a $348 million raise by data centre focused GLP, and a $334.9 million raise by Galactic Energy. Comparatively, India attracted $3.2 billion in VC investment during the quarter while Japan attracted $1.3 billion and Australia $1 billion.
Steady course expected heading into Q4’25
Looking ahead to Q4’25, global VC investment is expected to remain relatively stable, fueled by continued momentum in AI model development, industry-specific AI applications, and AI infrastructure. Robotics is also anticipated to gain further traction among VC investors over the coming quarter. Given AI’s dominance, companies without AI-driven capabilities could find it increasingly challenging to attract funding. However, in regions such as Africa, Latin America, and Southeast Asia, fintech is expected to remain the primary investment focus.
Exit activity is expected to strengthen globally in Q4’25, barring an extended government shutdown in the US, with a more pronounced rebound anticipated heading into 2026 as mature startups seek to capitalize on the improving IPO environment in the US.
Moore added “Despite ongoing geopolitical challenges, there’s a good sense of positivity in the global VC market heading into Q4’25. The opening of the IPO markets in the US and Asia are a particularly optimistic sign—with increasing IPO exits expected into Q4’25 and into 2026, baring a long disruption by the US government shutdown—which could throw a wrench into expectations—the future is looking brighter for the VC market than it has in quite a while—although any real uptick in VC funding will likely come in the new year.”
